Volkswagen stocks surge as they announced new plans to overtake Tesla by 2025
Volkswagen shares rose 20% this week after the automaker detailed how it plans to overtake Tesla and become the largest electric car maker by 2025. The surge in their stocks was the biggest since 2008, when the company suffered another ‘short-squeeze’ that elevated it – briefly – to the position of the largest company in the world.
Volkswagen said it will standardize the production of key electrification technologies across its industrial empire and generate scale effects that “neither Tesla nor other traditional automakers are able to replicate.”
The company also said that it will build six lithium battery factories (an essential input for electric cars) in Europe alone, and that it plans to invest in a technology that would reduce the cost of the batteries by 50%.
This year, the automaker said it expects to sell 1 million electric cars – which would put Volkswagen ahead of Tesla in terms of volume.
Volkswagen will also increase its software area, hiring thousands of developers. The plan is to have 10,000 programmers working on automation technologies and in-car systems. (The new hires will make Volkswagen the second largest software company in Europe, only behind SAP).